Leadership Games with Convex Strategy Sets

Bernhard von Stengel and Shmuel Zamir ()

Discussion Paper Series from The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem

Abstract: A basic model of commitment is to convert a two-player game in strategic form to a leadership game with the same payoffs, where one player, the leader, commits to a strategy, to which the second player always chooses a best reply. This paper studies such leadership games for games with convex strategy sets. We apply them to mixed extensions of finite games, which we analyze completely, including nongeneric games. The main result is that leadership is advantageous in the sense that, as a set, the leaders payoffs in equilibrium are at least as high as his Nash and correlated equilibrium payoffs in the simultaneous game. We also consider leadership games with three or more players, where most conclusions no longer hold.

Pages: 21 pages
Date: 2009-11
New Economics Papers: this item is included in nep-gth, nep-ind and nep-mic
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Related works:
Journal Article: Leadership games with convex strategy sets (2010)
Working Paper: Leadership games with convex strategy sets (2010)
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